I don't know, but I don't want to be somehow whether by lien on our home (she was on the deed, not the note) or her car I am going to sell.

She's going to have to take the tax affidavit to be allowed to permanently leave (many just skip this step and move out), but she doesn't know if she will ever end up back in the USA. I doubt she will, but she worries about EVERYTHING.

If everything works out well, I am going to let her just keep that 401k intact (it's only $6500 right now) and just pay from the proceeds from our liquidations.

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The Masamune blade would repel the leaves and let them flow safely down the stream, while the Murasame blade would attract and cut them up.

401K is through her employer. Is she quitting? Best thing to do is set het up an IRA in her name only.

Roll over the 401K into the IRA. Now it is her headache alone if she chooses to liquidate. If you file a joint return for 2012 the 401K shows up and is offset by the IRA rollover. Make sure that conversion is done before end of year. Then the following year, ensure no ties into her financially. Her income is hers. The divorce needs to be finalized before the IRA gets liquidated. Otherwise you can be liable.

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F15 Air Superiority Fighter - Never has one been lost in aerial combat (104 kills)

Can we assume that you (no pun intended) are filing married filing jointly?

If the answer is yes AND she withdraws funds before you divorce my GUESS is that yes, you (jointly) will be responsible for a bunch-o-taxes ... unless you can convince her to wait until after the legal divorce.

I can't wait to see where this thread goes ...

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I find it ironic that when I was young I wanted a lot of things but had little money but now in older age have some money but want very little.

Can we assume that you (no pun intended) are filing married filing jointly?

If the answer is yes AND she withdraws funds before you divorce my GUESS is that yes, you (jointly) will be responsible for a bunch-o-taxes ... unless you can convince her to wait until after the legal divorce.

smoblikat you fool, you fell victim to one of the classic blunders! the most famous of which is "never post your actual pay in an ATOT brag thread", but only slightly less well known is this: "never post your actual pay when alkemyst is online!!" hahahahaha

401K is through her employer. Is she quitting? Best thing to do is set het up an IRA in her name only.

Roll over the 401K into the IRA. Now it is her headache alone if she chooses to liquidate. If you file a joint return for 2012 the 401K shows up and is offset by the IRA rollover. Make sure that conversion is done before end of year. Then the following year, ensure no ties into her financially. Her income is hers. The divorce needs to be finalized before the IRA gets liquidated. Otherwise you can be liable.

This sounds like the answer.

Also, how bad can half of the tax burden on $6,500 be?

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Harvey -
And Whos's Watching Over Who's Watching Over You?
Tell me, who's telling who's telling you what to do what to do?

"Everything secret degenerates, even the administration of justice; nothing is safe that does not show how it can bear discussion and publicity." ľLord Acton

Is it unreasonable to just have her clear it out now, pay the 10% penalty on that, and then consider the remaining $5850 as income for this year? I assume she wants the money. I have no tax experience, just throwing it out there.